Similar to the rest of the country, the Boston real estate market seems to be experiencing somewhat of a slow-down.
What does a "slow down" mean? Sale prices are leveling or decreasing, and homes are taking longer to sell. You likely won't see many agents calling Boston a "Buyer's Market" just yet, but we are starting to see a shift to buyers having more bargaining power.
Boston Real Estate Buyers
The last two years in real estate were unlike any other in recent history. According to Redfin reports, home prices in 2022 rose over 27% from 2019. For example, in 2019 a home sold for $420,000 and in 2022 the same house sold for $535,000. If you were a buyer in 2020-2022 and experienced home bidding wars, it may have felt defeating, causing some would-be homebuyers to throw in the towel.
The recent rise in interest rates have now pushed the cost of buying higher. Rising mortgage rates, inflation and a supply shortage have brought us to the lowest point of affordability in 30 years. Some buyers are suddenly unable to afford mortgage amounts they were pre-approved for earlier in the year.
Boston Real Estate Sellers
The real estate market has been hot for several years. Many homeowners across the country thought about selling their homes, even if they loved them, just to capitalize on potential high profits from a sale. Homes sold quickly - often with multiple "over-asking" offers and sometimes with limited conditions or with no contingencies at all.
While the market may not be as frothy, it is still a strong time for sellers to list their home in Boston. However, sellers will likely also have to be more patient, and allow buyers contingencies that may have been waived when they were in the midst of bidding wars.
Boston real estate sale prices are down 12% year-over-year and the number of closed sales is down 22% compared to last year, according to Redfin reports. There are plenty of options for buyers and sellers in the Boston market. Both will need to have patience and be willing to compromise in order to secure the best deals.